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• Louisiana Warranty Statutes and Marine Products By Jay M. Jalenak, Jr. The Louisiana Civil Code provides an implied warranty for all things sold.  Specifically, a seller warrants the buyer against all redhibitory vices and defects.  A defect is “redhibitory” if it renders the item so useless or inconvenient that a buyer would not have purchased it or would have purchased it for a lesser price.   Louisiana does not have warranty statutes which are specific to marine products.  The following outline is an overview of Louisiana's warranty statutes in connection with marine products such as boats, personal watercraft, and outboard motors.A. Marine Product Warranty Statutes Louisiana does not have warranty statutes which are specific to marine products. B. General Warranty Statutes The Louisiana Civil Code provides an implied warranty, “redhibition”, for all things sold. Specifically, a seller warrants the buyer against all redhibitory vices and defects. A defect is ....
• Declaratory Judgment Action Still Requires Case or Controversy By Sonny Chastain The Fifth Circuit Court of Appeals recently addressed the standard for a declaratory judgment action in the context of trademark rights. In Vantage Trailers, Inc. v. Beall Corporation, 567 F.3d 745 (5th Cir. 2009), Vantage filed civil action seeking declaratory judgment finding that its designed for a new aluminum bottom dump trailer would not infringe on any valid trademark rights of Beall Corporation.  Beall manufacturers and sells an aluminum bottom dump trailer which is protected by a registered trademark.  In early 2006, Vantage began designing its own aluminum bottom dump trailer.  In July 2006, Beall’s vice president sent a letter to Vantage stating that if your company places any trailers into service that violate any of Beall’s trademarks we will pursue legal action to stop the infringement. In response to the letter, Vantage filed a civil action seeking a declaratory judgment that Beall’s trademark is invalid and that the ....
• The Limits on E-Discovery Nearly three years have passed since electronic discovery was formally introduced into the realm of discovery.  The scope of electronic discovery is broad- it includes discovery of “any information that can be stored electronically, including writings, drawings, graphs, charts, photographs, sound recordings, images, and other data or compilations—stored in any medium from which information can be obtained either directly, or if necessary, after translation by the responding party into a reasonably usable form.” However, the discovery of electronically stored information (“ESI”) is not without its limitations, thus lending comfort to those old dogs who do not want to learn new tricks. This article is aimed at fleshing out what limitations, if any, exist in the black hole of electronic discovery. Read the entire article from Around the Bar by Katie D. Bell and reprinted with permission from the Baton Rouge Bar Association.  ....
• What does the Transfer of Chinese Drywall Cases by the United States Judicial Panel on Multidistrict Litigation Mean? Throughout 2004–2007 a housing boom along with a series of hurricanes in the Gulf of Mexico combined to create a shortage of drywall in the United States.  Needing drywall to build the homes that were much in demand, suppliers turned abroad. Chinese manufacturers stepped in, providing cheap and readily available material.  This influx of Chinese drywall was concentrated in Florida, Louisiana, and Mississippi; the states most affected by Hurricanes Wilma, Katrina, and Rita.  Since 2006, it has been estimated by some sources that more than 550 million pounds of drywall have been imported from China.  There are reports that some 100,000 homes could possibly be affected nationwide. Reports of the damage caused by Chinese drywall to air conditioning units and appliances as well as health problems associated with it started to surface in 2006.  It has been reported that organic and chemical compounds in certain samples of drywall causes a ....
• Louisiana Legislature directs DHH, the Department of Insurance, and the Louisiana State Licensing Board for Contractors to Study the Effects of "defective Chinese Drywall" By G. Trippe Hawthorne The Louisiana Legislature has adopted House Concurrent Resolution No. 185, authored by Representative Tim Burns.  The resolution urges and requests that the Department of Health and Hospitals and the Deptartment of Insurance, in consultation with the Louisiana State Licensing Board for Contractors, investigate the health risks associated with living in homes that contain drywall imported from China, study the potential homeowners insurance coverage issues, including triggers, endorsements, and exclusions to policies that are related to drywall imported from China, and determine whether such material should be identified as a substandard, unsafe building material.  The resolution goes on to request a report of the findings and recommendations of this study to the legislature prior to the convening of the 2010 regular session. A copy of the enrolled version of the resolution can be seen here: Download file ....
• Quick Action by Registered Trademark Owners May Prevent Future Facebook Problems Beginning at 12:01 a.m. (Eastern Standard Time), on Saturday, June 13, 2009, members of the social networking website, Facebook, will be able to claim usernames to associate with their Facebook accounts and Facebook pages. This will allow Facebook pages to be accessed by using a url such as, http://www.facebook.com/unitedairlines, or something similar. Facebook is taking certain steps to prevent infringement of intellectual property through “name-squatting.” In connection with this, Facebook is allowing Federally registered trademark holders to prevent the registration of usernames that would infringe their intellectual property rights. There is a link to the form on Facebook’s Web site if you want to complete the form yourself. You will need the trademark registration number and the exact wording of the trademark as registered. For more information, or to protect your trademark, please contact Pamela Baxter at pamela.baxter@keanmiller.com (225.389.3761) or ....
• Franchise or Distributorship Termination Under Louisiana Law By Charles S. McCowan, Jr. In today's difficult economic climate, franchisors are often faced with a decision to consolidate, not renew or terminate unprofitable franchises.  Generally, franchise agreements have been entered into in better economic times and contain provisions that attempt to minimize adverse economic consequences to the franchisor arising from a non-renewal or termination.  The termination decision often leads to legal challenges involving the validity of such provisions.  These challenges include a determination of whether the termination is permitted by the contract, termination procedures, buy back issues and any damages that flow from the termination or non-renewal.Louisiana has adopted a number of provisions that relate to the expiration, non-renewal or termination of particular types of franchise agreements.  The general Louisiana rule is that unless the provisions of a business franchise provide otherwise, when the business to be ....
• Responsibility for Damage Caused by Falling Trees and For Removal of Fallen Trees By Michael O'Brien and Stephen Hanemann Hurricane Gustav recently wreaked havoc and felled trees throughout the heavily wooded areas of Southeast Louisiana.  As such, many property owners may be concerned who bears the responsibility for a fallen tree. Obviously, if a tree in a homeowner’s yard falls on his house, then that homeowner should contact his insurance agent for assistance in repairing the tree damage. The remainder of this article addresses the issue of tree-owner responsibility when a tree located on the property of one person (the “tree owner”) falls on the property of his neighbor (the “property owner”) damaging the house, car, fence or other property.A tree owner is not responsible for the damage caused by trees felled by the winds of Hurricane Gustav unless the neighboring property owner can establish that the tree fell because of its poor condition that the tree owner knew or should have known existed.  In the overwhelming ....
• Contractors' Faulty Workmanship Not Covered by Insurance Policy by Todd A. Rossi According to the Louisiana Supreme Court, a commercial general liability policy unambiguously excluded coverage for a contractor’s faulty workmanship. Supreme Services & Specialty Co. Inc. v. Sonny Greer, 958 So.2d 634 (La. 2007). The homeowner instituted legal action claiming that cracks in the slab were the result of faulty and defective design and construction, alleging causes of action based on breach of contract and breach of warranty. Relying on the "work product" exclusion in the policy, the court recognized that it reflected the insurance company’s intent to "avoid the possibility that coverage under a CGL policy will be used to repair and replace the insured’s defective products and faulty workmanship." The court recognized that a commercial general liability policy "is not written to guarantee the quality of the insured’s work or product." The court also found that the term "work" was defined ....
• FIRST CIRCUIT ADDRESSES ARBITRATION AGREEMENT by James R. Chastain, Jr. On March 23, 2007, the Louisiana First Circuit addressed the validity of an arbitration agreement in Lafleur v. Law Offices of Anthony G. Buzbee, 2007 WL 858859 (La. App. 1st Cir. 2007). The opinion has not been released in permanent law reports and is still subject to revision or withdrawal. The case arises out of a contract between Mr. Lafleur, a Louisiana resident, and his Texas attorneys, Jeffrey M. Stern and the firm of Stern, Miller, and Higdon. Mr. Lafleur retained the Stern defendants to pursue his maritime claim for personal injuries he sustained while traveling on a vessel in navigable waters off the coast of Louisiana. He executed an agreement with the Stern defendants which stated, "Any and all disputes, controversies, claims or demands arising out of or relating to this Agreement or any provisions hereof, the providing of services by the Stern defendants to Mr. Lafleur, or in any way relating to the relationship between the Stern defendants ....
• COMMERCIAL LEASES: EXCLUSIVE AND PROHIBITED USE CLAUSES by Brett N. Brinson Most commercial leases for multi-tenant properties contain clauses which regulate the tenants' use of the leased premises. Many tenants will require a landlord to grant the tenant the exclusive right to operate a certain business or sell a certain product to avoid competing with other tenants. These provisions are appropriately referred to as exclusive use clauses. For the landlord to satisfy its obligations under an exclusive use clause of one lease, the landlord is required to incorporate provisions in its other leases prohibiting the other tenants from using the leased premises for the restricted purpose. These clauses are commonly referred to as prohibited use clauses. A landlord may also include a prohibited use clause to prevent a tenant from using the leased premises in a manner which the landlord believes is a nuisance to the other tenants and reducing the overall value of the property. For example, a landlord may consider a ....
• Construction Law Litigation Strategies by David K. Nelson Much of the time of a construction lawyer is spent assisting clients in finding solutions to the many problems that befall the typical construction project. These problems range from simple contract preparation and negotiation to the more fact-intensive work of constructive defect litigation, surety claims, liens, and payment issues. Each construction project, no matter how complex or simple, involves the same basic issues: • What is the scope of work that the parties agreed to? • What documents or plans define the scope of work? • How is the contractor to be paid for his work? • How can the owner be assured that the contractor is doing the work properly? • What is to be done when there are issues or problems with respect to any of the above? The job of the construction attorney is to help chart a course through this minefield and ideally resolve issues without judicial intervention. See the rest of the article here. It is an article of ....
• Efforts to Maintain Trade Secrets to be Scrutinized The Uniform Trade Secrets Act, La. 51:1431, et seq., provides a cause of action for misappropriation of a trade secret. However, it is important to recognize that these are specific terms which must be satisfied in order to trigger the remedies provided in the Act.A trade secret is defined as information, including a formula, pattern, compilation, program, device, technique or process that (a) derives independent economic value from not being generally known to and not being readily ascertainable by a proper means by other persons who can obtain economic value from its disclosure or use and (b) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. Both elements must be satisfied in order to be a trade secret and possibly have protection of the Act. For example, a formula, process or customer list that is not to be generally known and derives economic benefit there from may satisfy the first element of the definition. However, reasonable steps ....
• Kean Miller Adds 12 Attorneys in Admiralty & Maritime, Construction, and Energy Practice Groups - New Orleans Office Triples in Size Kean Miller is pleased to announce that 12 lawyers, formerly in the Admiralty & Maritime, Construction, and Energy practice areas with Lemle & Kelleher, LLP, have joined the firm in the New Orleans office. "We are very excited to welcome these distinguished attorneys to our law firm. They are an outstanding resource for our clients. Our offices are located in Louisiana's major port cities --- New Orleans, Baton Rouge and Lake Charles -- and this esteemed group brings over 150 years of combined experience in maritime issues, admiralty law, marine insurance, oil & gas, drilling and exploration, pipelines, construction, and energy law to our clients." said Gary A. Bezet, managing partner of the 121-lawyer firm. The new group from Lemle & Kelleher nearly triples the size of Kean Miller's New Orleans office from 7 attorneys to 19 attorneys. The strategic acquisition builds on Kean Miller's position as the largest law firm in the Capital Region, and strengthens Kean Miller's regional ....
• One More Nail in the Coffin - The Single Business Enterprise Theory Rides Again A recent Third Circuit decision joined the long and growing list of cases supporting the Single Business Enterprise Theory exception to the long standing principle that corporations are separate and distinct legal entities apart from their shareholders and affiliated companies. Under this long standing principle, shareholders are not liable for the corporation's debts and the corporation itself is not liable for the debts of its owners or the debts of other corporations that it owns or that its shareholders own. Unfortunately, more and more this principle known as Limited Liability is being placed in a coffin and being nailed shut. For all businesses, be they large international conglomerates or small mom and pops, the Single Business Enterprise Theory should cause grave concern. In the case of Dishon v Ponthie, Third Circuit, No. 05-659 (12/30/05), the court found that an enterprising individual (Ponthie) owned and operated two companies as a single business enterprise and therefore ....
• Louisiana Supreme Court Addresses Arbitration Agreements The Louisiana Supreme Court addressed the enforceability of an arbitration agreement in Aguillard v. Auction Management Corporation. In this action, defendant Gilmore Auction & Realty Company conducted a public action of certain real estate property. Prior to the auction, a sales brochure was distributed to prospective bidders. Mr. Aguillard attended the onsite auction and received a copy of a document entitled "Auction Terms and Conditions" which included an arbitration clause. He signed and returned the document. Thereafter, Mr. Aguillard submitted the winning bid at the auction. However, the seller subsequently rejected his bid and refused to close the sale of the property arguing that the auction was not absolute and any offer was subject to the seller's confirmation. Mr. Aguillard filed suit to enforce the sales agreement and in response a joint motion to stay pending arbitration was submitted. The district court denied the motion to stay. The Third Circuit Court of Appeals ....
• Geographic Scope of the Non-Compete Statute in Louisiana In La. R.S. 23:921, Louisiana law states every contract or agreement or provision thereof by which anyone is restrained from exercising a lawful profession, trade, or business, of any kind, except as set forth in this Section shall be null and void. It is the Legislature's way of making the general statement that the state of Louisiana wants people working. However, Section (C) of this statute does allow a person who is employed as an agent, servant or employee to agree with his or her employer to refrain from carrying on or engaging in a business similar to that of the employer within a specified parish or parishes, municipality or municipalities, or parts thereof, so long as the employer carries on a like business therein, not to exceed a period of two years from termination of the agreement. The statute requires that the parishes be specified and that the time period be for no longer than two years. Moreover, it requires that the employer carry on a like business therein. One ....
• Intellectual Property Disputes By Russel Primeaux Someone once observed that most car accidents occur within 10 blocks of the driver's home. We see a analogous trend in Intellectual Property "crimes" - i.e. infringement of patents, trademarks, or copyrights; or misappropriation of a trade secret. Intellectual Property (IP) disputes between two parties that are strangers to one another are the exception, not the rule. More often than not, IP infringement suits are between parties that were formerly in some type of business relationship. The most typical relationships that go awry are license relationships, joint ventures, and dealerships or distributorships. The licenses can be for trademarks, trade secrets, or patents. In a trademark license, the licensor (the trademark owner who is granting the license) should ensure that the agreement covers good will generated by the licensee. The license agreement should clearly state that good will generated by the licensee in the trademark inures to the benefit of the ....
• Withholding Consent to Assignment - What is Reasonable? By Linda Perez Clark Very often, contracts prohibit assignment without the other party's consent. If you think you might ever want to assign a contract (bearing in mind that a merger or sale of the business can trigger assignment), then this kind of provision should generally be modified by adding that the other party's consent cannot be unreasonably withheld, conditioned or delayed. Without this language, consent can generally be withheld as long as doing so does not rise to the level of "abuse of rights," a theory difficult to prove (i.e., proof of intent to harm or a violation of good faith is required). Adding the language recommended above will require the other party to demonstrate some legitimate reason for denying consent, such as the proposed assignee is financially inferior to the assignor; the assignor is in default; or the proposed assignee cannot comply with the existing terms of the subject agreement. In a recent case, the court found that a landlord withholding consent ....
• Wind Versus Flood Coverage and Hurricane Katrina By Mark D. Mese Reproduced with permission from Class Action Action Litigation Report, Vol. 6, No. 21, pp. 795-797 (Nov 11, 2005). Copyright 2005 by The Bureau of National Affairs, Inc. (800-372-1033). http://www.bna.com The damages caused by Hurricane Katrina in Louisiana, Mississippi, and Alabama constitute the largest natural disaster in U.S. history. Hurricane Katrina's impact on insurers and their policyholders have already set in motion what will probably be one of the largest legal and public policy storms to hit the United States in modern times. Nowhere will the storm be more evident than in disputes involving wind and water damage coverage. The eye of the coverage storm is already manifesting itself in coastal areas of Louisiana, Mississippi, and Alabama. Insurers providing property and homeowner coverage in Katrina affected areas are taking the position in many cases, that most if not all of a policyholder's damages resulted from rising water flooding, thus resulting damages ....